Updated 11.10.11 The True Cause of $17 Billion Cold Chain Shrink The True Cause of the $17 Billion Cold Chain Shrink
The true cause of $17 billion cold chain shrink slide share
Jun 24, 2015
An overview of share shrink/waste occurs in the food cold chain and how retail grocers can proactively manage inventory and quality to improve customer satisfaction and profitability.
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Updated 11.10.11
The True Cause of $17 Billion Cold Chain Shrink
The True Cause of the $17 Billion Cold Chain Shrink
SHM PowerPoint Template Guidelines 03.15.10Intelleflex PowerPoint Template Guidelines | Updated 11.10.11
The new Retail Grocer landscape:
• Retail grocers are facing a tough, new environment.
• Retailers are looking at new ways to optimize cold chain operations due to:
- New regulations
- Fickle customers
Introduction
The True Cause of the $17 Billion Cold Chain Shrink
SHM PowerPoint Template Guidelines 03.15.10Intelleflex PowerPoint Template Guidelines | Updated 11.10.11
Wasted produce
• One third of shipped produce is wasted annually.
• $35 billion in perishable shrink.
• Stores lose 20% of available perishable profit to shrink.
• Reducing perishable shrinkage by 20% will increase total store profit by 33%.
The $35B Blind Spot
The True Cause of the $17 Billion Cold Chain Shrink
SHM PowerPoint Template Guidelines 03.15.10Intelleflex PowerPoint Template Guidelines | Updated 11.10.11
Where does shrink begin?
• At the store?
• In the truck?
• At the distribution center?
• Earlier?
The $35B Blind Spot
The True Cause of the $17 Billion Cold Chain Shrink
SHM PowerPoint Template Guidelines 03.15.10Intelleflex PowerPoint Template Guidelines | Updated 11.10.11
Shrink at the store:
• Many grocers think waste due to spoilage occurs after it is received at the store.
• Assumes uniform aging and shipment does not change from field to store.
• If quality was compromised, grocers would have rejected shipment.
The $35B Blind Spot
The True Cause of the $17 Billion Cold Chain Shrink
SHM PowerPoint Template Guidelines 03.15.10Intelleflex PowerPoint Template Guidelines | Updated 11.10.11
Shrink starts in the field
• ~50% due to bad post harvest practices
$17 billion cold chain waste per year!
Digging Deeper: Shrink Starts in the Field
Total Shrink
0 5 10 15 20 25 30 35 40
Post Harvest Prac-ticesOther
The True Cause of the $17 Billion Cold Chain Shrink
SHM PowerPoint Template Guidelines 03.15.10Intelleflex PowerPoint Template Guidelines | Updated 11.10.11
Truck-level monitoring:
• Typically uses one or two temperature monitors per truck.
• Does not monitor condition of all pallets – pallet level variation is significant and impacts quality.
• Visual inspection is not adequate – it is a lagging indicator and identifies problems after they have occurred.
Truck-level Monitoring
The True Cause of the $17 Billion Cold Chain Shrink
SHM PowerPoint Template Guidelines 03.15.10Intelleflex PowerPoint Template Guidelines | Updated 11.10.11
Truck-level Monitoring
0 Days left
2 Days left
4 Days left
6 Days left
Truck arrives at DC; condition of individual pallets is unknown
Status unknown
The True Cause of the $17 Billion Cold Chain Shrink
Consider this example: a truck with 8 pallets…
SHM PowerPoint Template Guidelines 03.15.10Intelleflex PowerPoint Template Guidelines | Updated 11.10.11
Truck-level Monitoring
0 Days left
2 Days left
4 Days left
6 Days left
One pallet is sampled. Status of other pallets remains unknown.
Status unknown
? ? ? ?
? ? ?
The True Cause of the $17 Billion Cold Chain Shrink
SHM PowerPoint Template Guidelines 03.15.10Intelleflex PowerPoint Template Guidelines | Updated 11.10.11
Truck-level Monitoring
0 Days left
2 Days left
4 Days left
6 Days left
Assumption: Entire shipment has 6 full days of shelf life left
Status unknown
The True Cause of the $17 Billion Cold Chain Shrink
SHM PowerPoint Template Guidelines 03.15.10Intelleflex PowerPoint Template Guidelines | Updated 11.10.11
Truck-level Monitoring
0 Days left
2 Days left
4 Days left
6 Days left
Reality: Only 25% of the shipment has 6 days left.
Status unknown
The True Cause of the $17 Billion Cold Chain Shrink
SHM PowerPoint Template Guidelines 03.15.10Intelleflex PowerPoint Template Guidelines | Updated 11.10.11
Implications
Sampling only one pallet results in a:
• 50% chance of rejecting entire shipment (100% waste)• 25% chance of assuming the entire shipment has 2
days of shelf life• 25% chance of assuming the entire shipment has 6
days of shelf life
All cases lead to waste or unsatisfied customers due to poor product quality!
The True Cause of the $17 Billion Cold Chain Shrink
SHM PowerPoint Template Guidelines 03.15.10Intelleflex PowerPoint Template Guidelines | Updated 11.10.11
Intelleflex Solution
• Achieves pallet-level monitoring
• Powerful ROI at under a dollar per pallet per use
• Tags can be read without unpacking trailers or pallets
• Reduces waste at the store by managing temperature from field to fork using FEFO
Intelleflex Solution
The True Cause of the $17 Billion Cold Chain Shrink
SHM PowerPoint Template Guidelines 03.15.10Intelleflex PowerPoint Template Guidelines | Updated 11.10.11
Pallet-level monitoring ensures:
• Quality and safety
• Profitability
• Traceability
End Result:
• Happy customers
• Reduced out of stocks
• Reduced overstocks
Pallet-level Monitoring
The True Cause of the $17 Billion Cold Chain Shrink
SHM PowerPoint Template Guidelines 03.15.10Intelleflex PowerPoint Template Guidelines | Updated 11.10.11
To learn more about cost-effective pallet-level tracking and addressing traceability requirements, download the full whitepaper at
www.intelleflex.com/cut-retail-waste
or email
Interested in Learning More?
The True Cause of the $17 Billion Cold Chain Shrink
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